Featured Listing: squishyfacedcrew

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Tell us a little about yourself. What’s your background? How did you start the business?

I’m Mike, and I have a background in e-commerce going back over 15 years. SquishyFacedCrew – a popular hashtag on Instagram for Bulldog breeds – was started in July 2019 to celebrate our then-new British bulldog puppy, Winnie. I recognised that the market for personalised products intended to celebrate our pets was enormous, and the margins made it a seriously interesting and rapidly growing niche.

As an e-Commerce business, where are your products made?

We sell a range of print on demand products. Our canvas art designs are made and shipped as locally as possible to our customers, to minimise shipping time and cost. Our core products, our custom pet pillows and squishes are made on-demand in China, by a dedicated and hands-on supplier. We have spent over $200k with that supplier all time, and get a tremendous rate card (around a third below Aliexpress prices) – which has made it almost impossible to find suppliers in the US or western EU that can get anywhere near our current margins.
 
As a SaaS business, what can you tell us about your Customer Lifetime Value (CLV) and Customer Acquisition Cost (CAC)

LTV is an interesting one for us – I had always assumed that our products would be more of a ‘purchase once’ sort of proposition, as the strongest avatar is a bereaved pet parent looking to buy a cuddly reminder of a pet who has sadly crossed the rainbow bridge. However we have actually seen a 21% returning customer rate in 2021 thus far, and I expect that to continue trending hard through the upcoming gifting season. We currently acquire customers organically via Google search, email (we’re still closing subscribers who signed up majoritively thus time last year) and organic social. When running ads at scale on Facebook, we were seeing a CPA of $15-20, backing into a ROAS of around 1.75.

How have you marketed the product and where are your customers originating from?

We traditionally leant in heavily on Facebook ads, backed up by Google (using a Shopify app called StoreYa to outsource for an easy hands-off ROAS of just shy of 2). This was all backed up by email – which is a huge driver for SFC (over 30% of revenue), and around $20k of organic sales in the last year. Currently, due to a FB account disablement in early 2021 and a disinclination to re-start (time and resource constraints at the time) and despite the encouragement of our Facebook rep, we have instead focussed on the more organic value this year. Adding a blog and unique content, optimising and enrichening the on-site content. Starting to build some high DA links with HQ content behind them, building out email, etc. This has gotten the business to a position where it is better placed to run ads at higher volume whilst getting more revenue diversity.

Is the asset on your listing owner-operated, how much time does it take to run the business, who else is needed on the team, and what is automated?

We benefit enormously from our supplier being ‘hands-on Shopify’. She handles orders, follows a robust process for sending customers a design proof (Shopify app) to approve or request changes, then handles the product creation and shipping directly. We just handle paying her invoice. I have a VA resource that I have used off and on the site, as part of a wider set of projects. He could come over with the store and would expect in the region of $3/hour. I don’t currently use any marked amount of his time in the store, a max of an hour or two a week currently. He knows the business intimately, so I’d recommend taking him with the store, at least over the transition period.

What does someone need to do to continue operating the business in its current form?

Assuming you continue using our supplier, and perhaps take our VA resource Nino, then the bare essentials would be minimal. Currently, I handle email directly and have produced the onsite content. If you’re running ads, then that was always handled by us directly – with hands and attention on the relevant ad consoles to measure and optimise. This could of course be run by an agency if an owner preferred to outsource. Currently, I am investing sub 2 hours a week in the store.

Additionally, we have access to some outsourced media buyers who run at around $600-700 PCM, which we’d happily connect with you. This resource is based in Brazil and would be full time.

Can you list a few opportunities for a potential new owner to continue growing the business?

There are multiple opportunities.

1. Our SEO is in its infancy, but the work we have done is proving value. The big stores in the space; Crown and Paw, PopYourPup, West & Willow etc have significant SEO driven sales.

2. Email campaigns are still an opportunity, we have only driven 8% of revenue from campaigns in the last year. The automation/flows are great and work tremendously, but campaigns have always been highly sporadic. The content needed on site for SEO should tag-team nicely with the content needed for email.

3. Product diversity – we have driven almost all of our sales from our core pillow product, despite the wide catalogue of other products – I’d strongly recommend driving diversity as there are lots of potentially huge products on the site that need solid marketing push. I’m convinced that Google Shopping and marketplaces could be leant in heavily on to drive some real and fast growth.

4. We have a professional translation of our core and highly optimised Zipify page landing page with French and Spanish versions. This would open up cheaper markets to advertise into with a very unique product.

5. We have a whole flywheel influencer strategy that we’ll happily share with the next owner. This could be huge, considering the number of micro pet influencers. There’s also a huge opportunity to partner with celebrities on a bigger scale, especially those who celebrate their pets on social media. Lewis Hamilton, 7-time f1 world champion, is a good example. This would be a considerable marketing expense but one to consider, the scale, landing page authority, leverage assets this would produce for email, landing pages, ads etc would be enough to take this store to the next level.

What has been the evolution of this asset since its launch?

We found our product-market fit with our core product, after lots of product experimentation around Sept/Oct 2019. Q4 2020 was huge; over $111k of sales in November and $80k of sales in December (bearing in mind with personalised products our order cut off for Xmas is around December 10th usually). The business hit a stumbling block in January of this year. As I explain in detail in my overview document on the listing; we attempted to change supplier to a U.K based supplier in late Nov last year. We’d tested the supplier through the summer and early fall, and were comfortable they’d deliver the quality we needed, and that they’d help us sell under the ‘made in the U.K’ banner. We figured that our quirkier products would work well in the US market with the made in the U.K, and we could ship in just a few days to the U.K and EU markets. Sadly this supplier let us down. They missed their production SLAs and got underwater with our order volume. Their quality wasn’t as good at scale as in China, and this led to late Xmas orders and QC complaints, which in turn brought a quick and short wave of negative FB reviews. Our review scores on FB had always been 4+ out of 5, but this negative drop led to the disablement of our ad account. Since then, we have solidified our partnership with China, and locked in the hands-on Shopify support, with our great rate card. This journey of improvement can be seen in our reviews – with satisfaction now very high again after this blip. We have a lot of regrets with that process but have rebuilt strongly and the lessons are there to be headed.

How does this business make money? What are the current revenue streams?

e-commerce – all revenue is sales-driven, alongside a noteworthy number of tips that we have received

It’s worth highlighting that we also benefit from invoice payment terms – these are every 15th and 30th of the month. This is quite unusual in the dropshipping and print on demand space, where payment is typically upfront. This gives some real capital to be leveraged through ads, drawn down via Shopify payments in 1-2 days and repeated.

What marketing channels are most profitable for the business?

Google paid search, display retargeting, email. Facebook was always more of a volume driver/scale channel for acquisition, but it still gets a ROAS of around 1.75 against a BEP ROAS of around 1.3.

How does the business currently acquire customers and what is your breakdown for marketing costs?

Since the FB account issue, we haven’t been running ads, bar some small retargeting campaigns to enforce email acquisition campaigns. Currently, email and organic channels are driving the sales, running at around $1.5k per month organically.

How big is your current team? How many people does it take to run this business?

Eddi and I are the owners but haven’t been investing much time this year with the furlough scheme in the U.K winding down and being dragged back to the office for the day jobs. We Nino, our VA, who is doing a small handful of hours a week max, mainly handling the non-core pillow orders. Coco our supplier handles the rest and has agreed to provide up to 4 team members to handle the historic Q4 scale.

What’s the reason for selling your business on Flippa?

We have owned it for going on 2.5 years. During Covid, it was a great work outlet and scaled up hugely with that focus that we could give it. It needs a marketing focussed owner/team who can drive it forward and get it doing the kind of numbers we know it can again, and then to get to that next level. We have seen it do a 6 figure month, and I believe it could be at that level through the year and then peak markedly again above that level in Q4. We have built the foundations, and now hope to see someone scale it really hard into the tier 1 league!

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